Upstream POB Summary

Upstream Cat 1 Field

Activities to Date
(End 11/10) Northern Area Execution C1 JUNI 97 84 2%
EPC4 Kobalu Camp residents excl. KOBALU 43 38 1%
CCJV MENDI HH 306 403 12%
0 Fatalities CCJV Wellpad A 558 116 3%
0 LTIs EPC4 HGCP 90 25 1%
RWIs EPC5B KOMO AIRFIELD 997 916 27%
4 Hides 17 19 1%
MTIs
23 Southern Area Execution CCJV Gobe 449 449 13%
FA/ No Treat
283 Week 2 reporting error corrected CCJV Kutubu 199 222 6%
EHL MORO BASE 115 118 3%
896 NM/HAZID
EPC5A Pipeline 971 1034 30%
Incident Triangle
Grand Total 3966 3424 100%
TRIR LTIR MnHrs Non-Immune Semi-Immune
0.84 0.00 6,417,586 519 2905
15% 85%

General
 Work has been shut down at Wellpad A due to an incident on Jan 21 in which four project workers sustained minor injuries
from an assault by unknown individuals who illegally entered the camp. Investigations into the cause of the incident are
ongoing.
 Upstream Rebaseline effort progressing. Third workshop schedule for Jan 27.
 Community and land owner disruptions continue to cause downtime at various work locations.

C1 – Data not available until 26-Jan-2011

EPC1
Overall progress: 72.3% Previous weekly progress: .36% (progress usually provided by C1)
 Mechanical completion achieved at Iagifu mountaintop telecom site
 Design finalized for installation of power and fiber optic cables up Mt Hee
 Completed site survey for VSAT installations Kopi for new EPC5a construction camp

EPC2
Progress: 0.8% Plan vs. 0.2%Actual (30.8% Plan vs. 26.9% Actual)
Shortfall: Line pipe coating on hold due to delay in delivery of Sumitomo 7 th shipment. Progress should recover after
delivery is received in Kuantan near end of the month. Saipem continues to be slow to finalize Rev 0 documents.
 Formally notified Saipem that KERKOI JV is the new Representative Lanco at Omati Landfall
 Loadout completed for 7th line pipe shipment from Sumitomo. ETA in Kuantan on 29 January.
 Received 6 Month start of construction activities notification from Saipem/ Jan De Nul for Caution Bay work site. Planned
start ~July 15.
 Saipem reviewing their plan for Omati landfall operations due to lack of interested subcontractors and large commercial
disparity; subcontract award will be delayed

EPC4
Progress: 0.2% Plan vs. 0.2% Actual (9.5% Plan vs. 11.8% Actual)
 Issued FAT report from generator tests at Kato with punch lists. Engine tests 1 and 2 completed successfully this week.
String testing on schedule to commence week of 14 Feb.
 Preparing response to DPE on Permit-to-Construct
 Completed electrical cable connection to the WWTP at Tokaju Camp
 Temporary camp 3rd shipment arrived at Lae and is currently being off-loaded and transported to 11 Mile marshalling yard.
Near Term Activities:
 Complete foundations for Tokaju Pioneer Camp
 Complete fencing of fly camp (Upper Bench)
 Planning for Construction Risk Assessment in mid-February
 Permit-to-Construct Workshop with DPE in February
 Award Storage Tanks, Piling subcontracts
EPC5A
Progress: 0.2% Plan vs. 0.1% Actual (13.1% Plan vs. 13.2% Actual)
Shortfall: CTR is late in executing upgrade works on existing roads and bridges; changes of scope for the waste &
washdown facilities in Kopi area. CTR is currently reevaluating schedule and forecast will change.

 Conducted safety stand down with all Drivers and Machine Operators
 Brisbane Office remained unoccupied and without power for the full week
 EM presented metering basis and a presentation on hydraulic capacity to DPE in PNG
 Kopi Scraper Station main camp pad (100,000 m2), fencing, unit installation, and waste water facilities/system ongoing
(60% complete)
 Loading of 6th linepipe shipment is complete and vessel enroute to Paia

3 week look ahead

 First batch Fiber Optic Cable (FOC) duct scheduled to arrive into POM. First batch FOC to be ready ex-works

EPC5A - Onshore Week % Root Cause for Current Week Delays

Pipeline Downtime L&CA Labor BD / Weather Gov't Security Contractor EM
Lanco
KOPI/MORO 2.3% 30%           34% 37%
HIDES 0.04% 100%

EPC5B
Progress: 1.0% Plan vs 0.3% Actual (39.5% Plan vs. 10.2% Actual)
Shortfall: Construction delays due to site, mobilisation and landowner issues
 24 Operators passed Heavy Machinery Operator Course based on Australian standards. Recognized in PNG Post Courier
newspaper
 Presented new hanger layout to MCJV/Essar (scope reduction). Cost proposal expected end Jan
 Main Camp - Power Generation: permanent generators placed on pads, mechanical fit-out of generators ongoing
 Airfield - 330m of boundary demarcation fence installed on northwest side, approximately 300m gap to be completed on
northwest side
 Revised MOC for catering subcontract path forward

3 week look ahead:

 Finalise MCJV rebaseline schedule
 Resolution of Komo Main Camp catering
 MCJV to mark the spoil sites at construction worksite
 Commission 84 beds main camp

Root Cause for Current Week Delays

Week %
5B - Komo Airfield BD /
Downtime L&CA Labor Weather Gov't Security Contractor
Lanco
C&G Runway Zone C 50% 0% 0% 0% 40% 0% 0% 60%
Runway South Zone A 33% 0% 0% 0% 59% 0% 0% 41%
Runway North Zone D 40% 13% 0% 0% 15% 0% 0% 72%
Road Construction 51% 0% 0% 0% 56% 0% 0% 44%